Gold’s record rally is moving tantalisingly close to the psychologically key Rs175,000 level in Pakistan, powered by investors seeking cover from the political toll, as reflected in rupee weakness, faltering stocks and economic tensions.
According to All Pakistan Sarafa Gems and Jewellers Association, the price of precious commodity jumped by Rs2,200 per tola and Rs1,886 per 10 grams to settle at Rs174,900 and Rs149,948, respectively.
Arif Habib Commodities Managing Director and CEO Ahsan Mehanti identified three reasons which have triggered a record-breaking spree in the local gold market, these include:
- Unavailability of dollar in Pakistan
- International phenomenon
- Difference between interbank and open market exchange rate
The commodities expert explained that due to the unavailability of the greenback and speculation regarding the rupee-dollar parity investors have shifted their focus towards safe-haven assets.
Mehanti further added that the significant difference between exchange rates in interbank and open markets has also added fuel to the rising prices of the yellow metal as it is a common phenomenon that when rates in kerb markets are high gold prices also rise.
The association, however, mentioned that although gold hit an all-time high in Pakistan, its price still stood below cost. Gold is cheaper by Rs4,000 per tola compared to its price in Dubai.
Meanwhile, silver prices also registered gains and rose to an all-time high of Rs2,020 per tola and Rs1,731.82 per 10 grams after an increase of Rs40 and Rs34.29, respectively.
In the international market, gold prices settled at $1,796 after an increase of $3 per ounce.
